North Greenbush budget back in the black

NORTH GREENBUSH - After years of poor financial decisions by town officials, the 12,000 residents of the Albany suburb will be glad to hear the town budget is expected to be in the black again this year with taxes remaining flat.

This tentative 2013 budget proposed by town supervisor Alson Spain projects another year-end surplus, and will again maintain the tax levy at $5.15 and $5.70 per $1,000 assessed property valuation for the general and highway funds, respectively. It also budgets for a 20 percent increase in pension costs and a 10 percent increase in health insurance costs.

Last year the comptroller was to conduct an audit of the town's finances, but instead released a scathing report stating that the town's finances were in such disarray from years of financial mismanagement that an audit could not be conducted. The report stated that if egregious accounting errors were not rectified, the town board would not be able to accurately budget for the upcoming year.

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According to the report, those errors were a result of poor financial decisions by the comptroller, and a lack of oversight from the town board. The comptroller had made unauthorized transfers from the water and sewer funds to the general fund in the amount of $678,712 between Jan. 1, 2008 and Dec. 31, 2010. Such transfers are common municipal financial practice to pay for short-term cash flow needs, but these transfers were for large amounts, and the originating funds were not reimbursed in a timely manner.

"Funds were coming out of the wrong accounts, and going into the wrong accounts," said Deputy Supervisor Lou Desso, a current Republican town board member, and a member of the board when the errors were made.

At the time the transfers were made, the town was already operating in the red, with a $429,000 deficit in 2010. However, the full--and exact--extent of the deficit was not known until last February, when the comptroller released their report--the town was more than $1,000,000 in the hole.

The town board, who said that they were not aware such large transfers had been made, moved quickly to rectify the situation. They contracted with financial advising firm Cusack & Company to assist a new comptroller in sorting out the financial chaos. Within two weeks they had hired Tony Germano, the Chairman of the Planning Board, as comptroller.

Since those financially fraught days, the current board has slowly dug the town out of their million dollar chasm, and instated strict conservative policies--consolidating departments; cutting some positions to half time, others entirely; and increasing or creating new revenue sources.

In the past four years the town has consolidated the youth service department by eliminating the fulltime position of youth services director--whose responsibilities were assumed by Building Director Mike Miner--and cut to halftime the positions of comptroller, supervisor secretary, and another position in the building department. Yet the major savings came through a change in the way the tax formula is calculated.

In discussions with the county Desso, a county legislator representing Poestenkill, and North and East Greenbush, was able "to persuade" the county to change the sales tax distribution formula so that North Greenbush received a greater percentage, said Spain.

The town governments receive sales tax revenue from the county based upon the total assessed property value. However, the formula the county was using did not include the value of commercial properties benefiting from payment-in-lieu-of-tax programs established by the towns Industrial Development Agency. Many of the buildings in the town's technology park along Jordan Road, such as the MetLife and General Electric Building, are currently in PILOT programs and were therefore not being included in the county's assessment.

"There was an enormous amount of real property value that was not being figured into the formula," Spain said. After their inclusion the town saw a revenue increase of over $300,000 and has been benefitting from that increase since 2011.

"With the comptroller's recommendations and Tony Germano's leadership we now know, for the first time in five years, where we ended 2011," said Spain. "Finances are now under control, everything is going into the right accounts, and everything is coming out of the right accounts."

The town has also been experiencing experienced growth in recent years. Several projects are nearing completion, including the Eastwick Village senior apartment project in DeFreestville and the larger $20 million, townhouse project called The Pastures, which features 75 units on 28 acres. Both are nearing completion and will be bringing in further tax revenue. In addition, the town just approved 140 apartments in the Van Allen Park area that Spain expects will receive final approval from the board alter this month. Town officials see this growth as a broader sign of the town's positive financial health, and are thankful to be in such good straits.

"We've been growing during these past four years during some of the toughest economic times--and we continue to grow," said Spain.